Liquidations - US margin trading

If your margin level drops below acceptable thresholds, Kraken will initiate a liquidation to reduce risk and satisfy obligations.

• Some or all open positions will be closed immediately

• If closing positions are not sufficient to cover the obligation, collateral assets in your Kraken account may be converted to satisfy the remaining balance. Conversion fees apply, see Settling or closing a spot position on margin for the conversion fee schedule and order of preference.

• You will receive an email confirming the liquidation event

Note: The liquidation process is automated. Once initiated it cannot be stopped. It is the trader's responsibility to monitor positions and maintain sufficient margin at all times.

Your margin level determines your liquidation risk:

• If your margin level drops to 80%, you will receive a margin call notification. You should deposit additional funds or reduce your positions at this point.

• If your margin level drops to 40%, an automated liquidation will be triggered.

Rapid or sharp price movements can push your margin level down quickly, even if your positions were compliant earlier in the day.

Open positions and collateral assets are valued using real-time reference index prices provided by CF Benchmarks to:

• Value collateral for risk calculations,

• Calculate account equity and margin level, and

• Determine margin call and liquidation triggers.

Index reference prices are for valuation and risk purposes and may differ from prices on any venue or the price you receive in liquidation.

Two types of fees may apply during a liquidation event:

• Position liquidation fee: Liquidation trades are executed at the CF Benchmarks index price with a 3% spread. No additional trading fees apply.

• Collateral conversion fee: If your collateral needs to be converted to cover the liquidation, conversion fees may apply: 1.5% between cash currencies, 2.5% for conversions involving BTC or ETH to/from cash, and 5% for all other conversions. See Settling or closing a spot position on margin for full details on the conversion fee schedule and order of preference.

*Conversion and liquidation charges may materially increase losses and may result in a deficiency.

Your Portfolio tab provides real-time tools to monitor your margin usage and risk exposure:

• Estimated Liquidation Value: Displays how much your account could lose before a liquidation event may be triggered, based on your current exposure

• Real-time updates: Your open positions, equity, unrealized PnL, and available margin are refreshed continuously

• Monitor your account actively: Margin levels and liquidation thresholds can change rapidly based on price movement. Even if a position was compliant earlier, losses can push your equity into risky territory

• Reduce position sizes: If you are approaching margin thresholds, consider reducing your exposure

• Maintain a buffer: Holding more than the minimum required margin gives you room to absorb price movements without triggering liquidation

• Act on margin calls promptly: If your margin level reaches 80%, deposit funds or close positions before it reaches the 40% liquidation threshold